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Couple things here,

Why don't you just cleaned install your iMac and use that. I use an iMac 2009 to as my media server, it's on 24/7 works great, just turn on home sharing, use Plex or both. Attached a time machine drive for auto back ups and your good.

Maybe replace the drive in the iMac to speed things up a bit. Other solutions will cost much more money IMO.

Now the wifi it's not fast on your iMac so buy a USB 802.11AC wifi adapter and your good. Not completely optimal but it works well.
 
This is true as well, but if she wanted to stream local media wirelessly, there solution to the older wifi chips.
 
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